MIRI: Rich deposits of crude oil and gas have been discovered in the vicinity of Miri City in northern Sarawak the first time in 24 years that “black gold” has been found in such a sizeable volume in the inland areas of Malaysia.

The discovery of the underground reserves by Petronas and Nippon Oil is poised to open up new frontiers in inland oil and gas exploration.

Miri MP Datuk Seri Peter Chin said yesterday it also signalled the possibility of more such finds in oil-rich Miri and the rest of northern Sarawak.

The Energy, Green Technology and Water Minister said he was informed by Petronas Exploration and Production Business Executive vice-president Datuk Wee Yiaw Hin that the national oil giant had announced the discovery at Block SK 333 onshore of Sarawak, via the Adong Kecil West 1 well, some 20km northeast of Miri city, yesterday.

“This is a discovery well drilled by Nippon Oil and it has yielded such a sizeable amount of oil and gas reserves inland of Miri,” he said of the drilling tests that achieved a flow rate of 440 barrels of crude oil per day and 11.5 million standard cubic feet of gas per day.

“More than 20 years ago, the oil companies abandoned their inshore drilling operations and ventured offshore because they found enormous amounts of oil and gas underneath the sea-bed offshore Sarawak.

“However, this latest discovery shows that there may still be a huge amount of oil and gas inshore that has yet to be tapped.

“This inland discovery is very exciting in that it will open up another frontier for oil and gas exploration on our shores.

“It augurs well for future social and economic growth of Miri, of Sarawak and also of the country because of the potential revenue that will come into the national coffers.”

Sarawak Assistant State Minister for Communications Datuk Lee Kim Shin said the Nippon Oil top brass had told him that the latest developments would spur another socio-economic boom for the northern hub of Miri.

“Nippon Oil bosses confirmed that they discovered the hydrocarbon reserves during a discovery drilling,” he said. “They want to drill another discovery well to ascertain the exact volume of oil and gas inside and they will also carry out another seismic survey.”

He said that while Nippon Oil had not decided when drilling for commercial production would start, “this new discovery is a very good sign that there are better days ahead”.

Chin said Petronas also made two other discoveries last November.

“Sizeable reserves have been found offshore the coast between Miri and Bintulu in the Guang North Gasfield, and another reserve in the SK307 Tukau Timur East field,” he said.

Chin said that under the Economic Transformation Programme, a key direction was to tap for oil and gas in marginal areas.

“The focus was to carry out intensive drilling in oil fields that were considered marginal or which had been abandoned long ago,” he said.

“This included drilling inland in places like Miri, which has the country's first inland oil well on top of Canada Hill.”

Petronas, in a press statement, said the last time such an onshore discovery was made was in 1989, in the Asam Paya Oilfield, also in Sarawak.

It said the Adong Kecil well was drilled by JX Nippon Oil and Gas Exploration (Onshore Sarawak) Ltd, the operator for Block SK 333, together with its joint-venture partner Petronas Carigali Sdn Bhd.

“The well was drilled to a depth of 3,170m and encountered a total of 349m of net hydrocarbon thickness,” it said.

“The two drill-stem tests achieved flow rates of about 440 barrels of crude oil per day and 11.5 million standard cubic feet of gas per day.”